Friday, June 28, 2013

George Osborne, The "Wonga Budget" and the dark arts; house prices and Broken Britain

George Osborne's latest strategy is to trap Labour into committing to the Conservatives' spending plans (thus making the "opposition" march to the government's financial tune, and offer the electorate an economic fait accompli).
In the meantime, "Gideon, Master Of The Dark Arts" continues the cynical strategy of divide and rule with the electorate of "strivers versus skivers", while using a hideous manipulation of numbers to pretend that the economic crisis can be blamed on the unemployed and welfare claimants, and that the only answer is to therefore bleed the helpless and the blameless, leaving the corrupt and indolent rich to continue to profit from the suffering (as Jonathan Freedland has said in his recent "Wonga Budget" article).

The behaviour of the Chancellor is so Machiavellian you almost couldn't make it up. It seems that part of George (the dark side: Gideon, Master Of The Dark Arts), almost enjoys his notoriety and unpopularity. Watching him shamelessly goad the Labour party as being the "welfare party", while also offering them to hoist themselves by their own petard, is a sickening spectacle to be seen happening in Westminster. As controller of the Tories' election strategy, as well as master of the economy, Osborne seems to revel in it, even though he is one of the most disastrous Chancellors Britain has had.

With the Tories tanking in the polls, and Ukip hoovering up much of their lost support, Osborne's strategy might seem smart (if utterly cynical) in the short-term, but is likely to be political suicide in the longer-term. I've said before about why Ukip are doing so well in the polls (and have created a new four-party political system).
But by drawing Labour in to the Tories' spending plans, it merely creates less and less to differentiate between the "big Three", to the advantage of Ukip rather than the Tories. Ukip have benefitted from the "consensus" that has existed around the three main parties; now Osborne is trying to create a "new consensus" around the idea of austerity being inevitable, with the welfare state being squarely to blame (neither actually being true in the slightest!). So if Labour buy into this "new consensus", more Labour voters
may well defect to Ukip instead, as has already started happening.
The hideous irony here is that Farage and Ukip's economic policy (when it makes sense) is even more "austere" in its view on public spending (though it is profligate in certain areas such as defence); so Labour voters who defect to Ukip because they're disillusioned with Labour turning its back on its compassionate principles will be voting for a party that is even more heartless towards the helpless than the Tories are.

It will be Farage who has most to celebrate from the latest "strategy" of Gideon, Master Of The Dark Arts.

It's difficult to know where to begin, in order to adequately explain why Osborne has been such a disaster for Britain.

I tried to explain this earlier, but but a good starting point, seeing as the figures came out just the other day, is the shocking state of the property market. It is now obvious that talk about "average UK house prices" is a nonsense, a kind of logical insanity. There is no meaningful "average" when between 2007 and today, average house prices in London have gone up by 5%, while in the rest of the UK, they have gone down by 9%; in Northern Ireland, they have gone down by a jaw-dropping 52%.
From these kind of yawning disparities, it is illogical to draw a meaningful "average", because whatever average you get is statistically meaningless - it's like comparing the GDP of Hong Kong to rural China, and saying that the "average" person has so much. How many of the people who live in those places could be called "average", and what is the use of such figures? The only "use" of such figures for Osborne is to use "average" house prices as an absurd and ludicrous bench-march to claim that the economy is improving.

It's for this reason that Osborne's greatest "achievement" (i.e. economic disaster) has been take the politics of divide and rule to the country on a financial level, and create two separate countries, divided clearly by house prices, the make-up of their economies and rates of employment.
On one hand, you have London and the Home Counties (population roughly ten million), which are as economically separate from the rest of the geographical UK that they may as well be a different country. Here, house prices continue to sky-rocket, the cost of living continues to soar, while salaries (high compared to the rest of the UK) struggle to keep up. Although unemployment is not high and there is plenty of work (both skilled and unskilled, and mostly in the private sector), people still struggle to save up money for a house, which can take more than ten years. Furthermore, there is a shortage of multiple-occupancy accommodation, making it even more difficult for families to economically survive.

It is the above part of the country that Osborne understands as meaning "The UK", and which he uses as his model to justify his economic policy. This explains his "bedroom tax" on people living in houses with empty spare rooms, for example; more on that in a moment.

Then there is the rest of the geographical UK. This is the larger part, where house prices have been on a continual downward spiral, the rate of unemployment remains stubbornly high (especially with the young), there is little incentive for private companies to invest (unlike in London), and the public sector provides a significantly larger proportion of the employment.
London-centred (and utterly ignorant) Osborne claims the large size of the public sector outside of the Home Counties is the reason why the economy there is stagnant (and all the more reason to neuter it); but history tells you it is due to a combination of factors, such as the collapse of heavy industries and mining in the post-war period, culminating in the Thatcher era.
While London's economy is diverse and service-based, the rest of the UK's is not - many regions specialised in producing certain goods upto the Second World War (Sheffield for steel, Stoke for pottery etc.). The fact that Osborne is so brainless he doesn't know simple British history (or is so heartless he doesn't care), is the most damning indictment of all. But almost all Tories have had the same view of the UK for decades, Thatcher being one of the most famous. So that lack of diversity meant that the public sector stepped in to take up the slack in the (inefficient) private sector. That is still true today for many parts of the UK outside of the Home Counties.
The "bedroom tax" was another classic example of Osborne's combination of economic brainlessness and emotional emptiness. While London has a lack of multi-occupancy housing, much of the post-industrial North has a surfeit of it. In cities and towns across much the North, single people struggle to find one bedroom flats and houses, because the houses were all built for families before the Second World War, for example. So this situation is the exact opposite to that in London. The differences in the local economy, added to the differences in the housing market, make The UK a country economically divided in two.

Having a government in London, of London and for London, is economic insanity for the rest of the country.

This is what it means to live in "Broken Britain". The UK, economically-speaking, is not fit for purpose, because, economically, it is two countries. While all large countries have disparities between the capital and the regions, in The UK, the differences, when laid about simply and clearly as above, are striking and unmistakable.

Having one economic policy for two economic realities is economically-crazy. This is what the Euro-zone is finding out, as Germany has an economic policy that works well for itself, but is creating an economic catastrophe in Southern Europe.

The Conservatives' plan is therefore to treat the rest of the UK as an out-sourced franchise of the Republic Of London.